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Level 1

Report foreign pension? (Sweden social security equivalent seems exempt as I read the treaty)

Thanks. I read the treaty. There is nothing about social security payment. However, there is a statement about  avoidance of double taxation.  I am not sure how to input the payment  and paid taxes and claim tax credit using turbo tax . This more technical problem then something else.

thanks again

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Expert Alumni

Report foreign pension? (Sweden social security equivalent seems exempt as I read the treaty)

International tax treaty-related issues are out of scope for advice.  Please consult a specialized professional for verification.

 

If you are certain about your entries, here are the steps:

 

In TurboTax online,

  • Sign in to your account and select Pick up where you left off
  • At the right upper corner, type in 1099r, then Enter
  • Select Jump to 1099r
  • Follow prompts
  • Next screen, Choose your bank or brokerage, select I'll type it in myself
  • On the screen Tell Us Which 1099-R You Have, check the box I need to prepare a substitute 1099-R and follow the prompts.  

 

As to the Federal ID, try entering nine 9s.  If electronic errors occur due to 1099-R data entry, enter the pension under Miscellaneous income, see instructions below. As long as the IRS has the pension reported and included in total income, it is not problematic. 

  • To your left, select Federal
  • From the top, select Wages and Income
  • Scroll down to last section -Less Common Income -select Miscellaneous Income, 1099-A, 1099-CStart 
  • Next screen, scroll down to Other Reportable IncomeStart
  • Follow prompts

 

If it is not taxable to you, to enter the exemption, follow here:

  • report your full amount as instructed above. Then enter the treaty exempt amount as a negative amount (e.g. -5000) under Other Reportable Income as instructed above.  
  • Download and fill in a Form 8833 from IRS to claim an exception.  https://www.irs.gov/pub/irs-pdf/f8833.pdf
  • You cannot e-file.  You can still use the TurboTax program to prepare your tax forms, but you need to print them out and submit them by mail along with form 8833. 

 

@wmczosno

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Level 3

Report foreign pension? (Sweden social security equivalent seems exempt as I read the treaty)

Thank you, this is great info. I used the Treaty claim the first year but the filing by mail was too much time and expense. I chose to report it as other income and take the Foreign tax credit, even though it was a little less favorable. It was nearly a wash when I figured in the cost of printing and mailing federal + three states, not to mention the aggravation factor.

 

It appears your solution of reporting the income as "other" and then reporting the same amount as a negative number avoids the 4852/substitute 1099r and thus the requirement to mail file. Although the 8833 also requires mail file, I thought if the treaty claim is for foreign social security you don't need that form? If that is correct I can e-file? 

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Expert Alumni

Report foreign pension? (Sweden social security equivalent seems exempt as I read the treaty)

When claiming an exemption from social security tax, the Form 8833 is not used but when claiming exemption from taxation of the income under the tax treaty upon distribution, Form 8833 is still the proper way to do do so.  

 

Since TurboTax doesn't support this form, it can't be electronically filed with our product.  

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Level 3

Report foreign pension? (Sweden social security equivalent seems exempt as I read the treaty)

Oh my, THAT is an important distinction. Thank you! And, bummer, my e-file plan is foiled, again.  :( 

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